1. Replacement costs for laptops is at 65% for the first year and decreases 20% every year thereafter with no depreciation of assets. When should we stop buying the locks?
2. Assuming replacement costs for laptops follows #1, in year 5, the controls are no longer effective as they used to be, and now the ARO is When should we stop buying the locks?
3. Assuming replacement costs for laptops follows #1, the price of locks increases by 25% in year 5 and continue to increase 5% every year thereafter. Additionally, the EF increased to 1.2 from years 2- When should we stop buying the locks?
4. Compare the analysis from #3 to buying insurance at 1.5% of total asset value (assuming straight line depreciation of 20% per year) for the first 10 years. Should you purchase insurance or the locks? At what year would it be economical to purchase insurance?

100 year1 year2 year3 4 5 6 asset $ 2,000.00 $ 1,300.00 $ 1,040.00 $ 832.00 665.60 $ 532.48 $ 425.98 # assets 100 100 100 100 100 100 locks $ 10.00 $ 10.00 $ 10.00 $ 10.00 $ 10.00 $ 10.00 $ 10.00 sle $ 2,000.00 $ 1,300.00 $ 1,040.00 $ 832.00 $ 665.60 $ 532.48 $ 425.98 aro before 4 4 4 4 4 4 4 aro after 1 1 1 1 1 2 1 ale before $ 8,000.00 $ 5,200.00 $ 4,160.00 $ 3,328.00 $ 2,662.40 $ 2,129.92 $ 1,703.94 ale after $ 2,000.00 $ 1,300.00 $ 1,040.00 $ 832.00 $ 665.60 $ 1,064.96 $ 425.98 safeguard val $ 1,000.00 $ 1,000.00 $ 1,000.00 $ 1,000.00 $ 1,000.00 $ 1,000.00 $ 1,000.00 savings $ 6,000.00 $ 3,900.00 $ 3,120.00 $ 2,496.00 $ 1,996.80 $ 1,064.96 $ 1,277.95 realized savings $ 5,000.00 2,900.00 $ 1,080.00 $ 664.00 331.20 $ (467.52) (148.03) 100 year1 year2 year3 4 5 6 asset $ 2,000.00 $ 1,300.00 $ 1,040.00 $ 832.00 665.60 $ 532.48 $ 425.98 # assets 100 100 100 100 100 100 locks $ 10.00 $ 10.00 $ 10.00 $ 10.00 $ 10.00 $ 10.00 $ 10.00 sle $ 2,000.00 $ 1,300.00 $ 1,040.00 $ 832.00 $ 665.60 $ 532.48 $ 425.98 aro before 4 4 4 4 4 4 4 aro after 1 1 1 1 1 2 1 ale before $ 8,000.00 $ 5,200.00 $ 4,160.00 $ 3,328.00 $ 2,662.40 $ 2,129.92 $ 1,703.94 ale after $ 2,000.00 $ 1,300.00 $ 1,040.00 $ 832.00 $ 665.60 $ 1,064.96 $ 425.98 safeguard val $ 1,000.00 $ 1,000.00 $ 1,000.00 $ 1,000.00 $ 1,000.00 $ 1,000.00 $ 1,000.00 savings $ 6,000.00 $ 3,900.00 $ 3,120.00 $ 2,496.00 $ 1,996.80 $ 1,064.96 $ 1,277.95 realized savings $ 5,000.00 2,900.00 $ 1,080.00 $ 664.00 331.20 $ (467.52) (148.03)